China's 'One Belt One Road' project - Risks and benefits for Bangladesh

China's OBOR (One Belt One Road) is a grand ambitious project running across the 3 continents - Asia/Europe /Africa. Hailed as ' Project of the century' by China, OBOR is an economic development based commercial project  that focuses on strengthening connectivity and fostering cooperation among 78 countries  of the world lying within the 3 continents.

In 2013, China announced its plan to restore the ancient silk route - the historic trade route dating back to the 2nd century BC until the 14th century AD that stretched from Asia to the Mediterranean Belt (traversing China/ India/ Persia/ Arabia/ Greece/ Italy). It was renowned as silk route because, the route was mainly used for silk trading and China monopolized the production and export of silk fabrics during the period.

Veritably, the silk route was a means to exchange culture in addition to exchange of silk products and other goods. Silk route largely contributed also to the development of science/ technology/ literature/ arts and other field of study. More importantly, it helped in spreading Islam, Buddhism and Christianity.

The silk route was primarily land based. But the 21st century OBOR is mainly maritime sea based that connects China's southern coast with the Mediterranean Belt /Africa/ / South East Asia/ Central Asia. China views the OBOR project as vital to accelerate its GDP growth rate, strengthen its trade base as well as explore and expand the market for its exportable goods.

OBOR is also known as BRI (Belt Road Initiative). Under the BRI initiative, China is committed to build roads/ airports/ seaport to integrate the developing as well as the underdeveloped countries lying closer to the Chinese economy in order to boost its export trade.

Bangladesh officially became a partner member of BRI project in the wake of the Chinese President's visit in 2016 when several deals between the 2 countries were signed. Under the deal, Bangladesh will receive $26 billion for BRI and $14 billion for joint venture project (totaling $40 billion).

The big Chinese loan is expected to be invested in power / infrastructure/manufacturing industries. In this connection it may be mentioned that the 2nd phase of the Shella-Ganjie power station project that has landed smoothly, is now under construction.

The completion of the project is expected to alleviate the shortage in local electricity supplyGeographically, Bangladesh holds a strategically important position blessed with the easy access to the Bay of Bengal and the Indian Ocean. Out of 2 maritime and 6 economic corridors under BRI initiative, one will pass through Bangladesh (the corridor that starts at Kunming city in China, passes through Myanmar and then enters the North East part of India.

The corridor finally ends up to Kolkata via Bangladesh).  To all intents and purposes, Bangladesh can be a suitable connecting corridor between the semi-industrialized ASEAN (Association of South East Asian countries) and the highly populated fast growing Indian sub-continent.
To conclude, if we want to reap tangible benefits from BRI, we have to face and overcome certain challenges.

First of all, the big Chinese loan of $ 40 billion may be a big concern and unmanageable debt burden in the face of absence of transparency and presence of deep rooted corruption. Additionally, most of the Chinese loans are commercial in nature with stiff interest rates.  So, while implementing BRI project, there must be zero tolerance for any corrupt practice. Moreover, the project needs to be environmentally risk free not causing any damage to the environment.

Secondly, China-India rivalry might put retardation to Bangladesh prospects. India has already displayed a negative approach towards OBOR project over Pakistan's involvement in CPEC (China Pakistan Economic Corridor). Given India's economic strength in South Asia, it can oppose tooth and nail the OBOR related projects in the region.

Veritably, both China and India are great and close trading partners of Bangladesh. In this connection it needs to be mentioned that around 97% of Bangladeshi products now enjoy duty free access to the Chinese market.  So, none can be ignored.

Again, putting greater priority for one and less for the other, may invite trouble for Bangladesh so far as its economic interests are concerned. As such, Bangladesh has to move with due care and caution keeping a vigilant eye on the present situation as well as future consequences.

Moreover, in the world of changing political games and commercial motives, there is hardly found any permanent friend or foe. Since China is the initiator and major beneficiary of the grand OBOR project , we can aptly utilize China's role in resolving the Rohingya crisis to which Bangladesh has unjustly fallen prey.

Myanmar maliciously triggered the crisis and in consequence earned wrath and hateful declamation from the international community. Over the last 3 years, more than 1 million innocent Rohingya refugees crossed into Bangladesh border to escape atrocities in the shape of mass killing /raping/ /burning /plundering wrought by the Myanmar's barbarous military hordes.

Bangladesh is always committed to peace. And as a peace loving country, Bangladesh has been still hosting the driven out and the displaced refugees absolutely on humanitarian ground providing them with adequate food, shelter, healthcare and other necessaries.  

According to the source (the Daily Star, July 5, 2019) it was encouraging to note that the Chinese Prime Minister assured to persuade Myanmar in order to resolve the Rohingya crisis through bilateral discussions. Further, the Chinese Prime Minister agreed that the return of the forcibly displaced people to their homeland is the only solution to the problem.

Conclusively, there exit both shining prospects as well as formidable risks for each and every partner country including Bangladesh pertaining to the OBOR project. So, the decision should be entirely based on our national interests but putting highest priority on national sovereignty.


The writer is a former General Manager of Credit Information Bureau, Bangladesh Bank